Oil approaches $50 a barrel

20/11/2008

Oil prices neared $50 (£33) a barrel during trading this morning after the publication of data showing that US demand for products such as heating oil, DERV, farm diesel and other derivatives is falling.

According to the Energy Department, fuel use in America has fallen some 19.1 million barrels, amounting to a seven per cent slump in the use of heating oil and other derivatives.

During early trading on the New York Mercantile Exchange, fell as much as 97 cents to $52.65 a barrel.

"U.S. demand has really been collapsing and dragging the Organisation for Economic Cooperation and Development demand as well and we might end up with a contraction in global demand growth for the year," said Antoine Halff, head of energy research at Newedge USA in New York, talking to Bloomberg.

Elsewhere, the BBC reports that the Organisation of the Petroleum Exporting Countries president Chakib Khelil has claimed that the cartel is unlikely to announce another production cut this month.